Bitcoin, Ether, Litecoin: Altcoins Bleed While Kings Snatch the Spotlight | Fundamental and Technical Analysis
While the vast majority of altcoins remain in a tumultuous state, the kings have finally snatched the spotlight once again.
Over the past few weeks, we have witnessed the biggest players in the crypto space, such as Bitcoin, Ether, and Litecoin, suspensefully hover around their “make it or break it” points, while the altcoin’s have jumped over hurdles and stretched for new recent highs.
Ripple (XRP), for example, has been experiencing quite a bit of bullish momentum leading up to its major event, SWELL, on Monday October 16th. For the week, XRP is up over 7% from its previous lows, and has seen a 30% gain over the last month so far.
Alongside this, NEO has gained a vast majority of its previously lost momentum, as it finally broke through its descending channel on September 25th and since then has marked a new monthly high of around $38.
Nonetheless, as shown by the charts below, NEO and XRP, while having re-gained quite a bit of lost momentum, seem to be lacking the amount of buy-volume they were previously experiencing. Due to this, NEO has declined over 25% to its 50-day moving average, and is currently resting at a crucial point directly below its previously formed uptrend. Similarly, XRP has been struggling to maintain much of its bullish traction, and has been experiencing difficulty crossing previous resistance around the $0.26 level.
However, there is a strong fundamental reason for the lack of performance within the altcoin market.
You see, due to the upcoming tech upgrades for Bitcoin and Ethereum, along with the blockchain hard-forks that would follow (giving coin holders a proportionate amount of the forked currency, such as Bitcoin Gold, for example), it seems that many investors and traders have been selling their altcoin positions to place them in the larger currencies.
For this reason, along with less significant fundamental factors, many of the larger altcoins, such as XRP, NEO, and OmiseGo, have been bleeding over the last week, while Bitcoin has rallied for new highs and Litecoin has followed with nearly a 20% gain.
Interestingly, however, while many of the larger altcoins have been suffering, a vast majority of the smaller ones have been performing quite well. Below are two diagrams that display the last 48 hours of price action within the cryptocurrency market.
Therefore, it might be safe to say that, as we near the upcoming forking events, the market may continue to suck the life out of many of the larger altcoins while investors focus on increasing their positions in Bitcoin and Ethereum for their long-anticipated network upgrades, along with for the free “lottery ticket” that comes along with that.
With that being said, let’s get into some technicals.
Technical Analysis
BTC/USD (Daily & Hourly):
Since October 12th, bitcoin has been able to successfully sustain an immense amount of buy-volume, causing the BTC/USD exchange rate to skyrocket over 25%, and break through its previous all-time high of $5000 in merely a few days.
However, as indicated by the MACD on the daily and hourly charts above, much of this volume was significantly over-bought, which led bitcoin on a decline from its high of over $5800 to just above $5500.
Nonetheless, the BTC/USD rate is still well above its 50-day and 100-day moving averages, indicating that its path of least resistance continues to be to the upside. If bitcoin’s sell-volume continues to increase, expect a possible retest of support around the $5000-$5300 level.
ETH/USD (Daily and Hourly):
Ethereum seems to have finally regained much of its lost momentum today from its recent correction.
As of right now, the ETH/USD exchange rate is currently sitting near previous resistance around $341, and seems to be finding decent support around that price level. Along with this, it has finally been able to cross well above its 50–day and 100-day moving averages, a milestone is not achieved since it steep decline from nearly $400 to $220 in September.
While an encouraging signal, much of Ethereum’s recent volume has been substantially over-bought, and seems to be losing a great majority of its momentum (as indicated by the steep decline of the 12-day exponential moving average on MACD). If the 12-day continues to steep below this point, this may indicate that sell-volume is steadily makings its way in and a retest of support around the $320 level may be due.
Similarly, if ETH can sustain support around this level, as its 50-day and 100-day moving averages continue to close in, expect continued bullish action to continue. Note: The most encouraging signal would be for the ETH/USD exchange rate to regain control of its uptrend around the $350 to $360 level.
LTC/USD (Daily and Hourly):
Similar to Ethereum, Litecoin also seems to be re-gaining much of its previously lost momentum. As of yesterday (October 12th), the LTC/USD exchange rate was able to successully cross over and find support above its 100-day moving average ($50 price level), followed by an 20% rally to $60 in merely a few hours.
However, similar to others, much of Litecoin’s recent volume has been quite over-bought, and is now beginning to lose some of its traction (as shown by the decline of the 12-day EMA on the MACD). Nonetheless, this decline in volume has not been accurately represented within Litecoin’s price action, as it has been able to sustain support above $57 quite well since its rally.
Note: If the LTC/USD exchange rate is able to successfully hurdle over its $62-$65 roadblock, expect continued bullish action to be evident.
Conclusion
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